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IP Addressing - Concepts Explained
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IP addresses are 32-bit numbers used in TCP/IP networks. They are considered layer 3 addresses because they are used in the 3rd or "Network" layer of the OSI Reference Model. They are also called logical addresses because they are assigned using software, whereas MAC addresses are physical because they are hard-coded into each network interface card.

More Than Just a Number

Let us look at an example IP address

What does this number mean? You can see that there are four numbers separated by dots. Each number is an 8-bit value, but usually the numbers are written in decimal since its easier on the eyes (and brain) to understand. This format is referred to as dotted-decimal notation.

Let's take the first 8-bit number or "octet" 192. When converted to binary we get 11000000. This is important for the next topic.

Move to the Head of the Class

IP addresses are grouped into five classes. Look at the chart below:

Class A 1 - 126 00000000

Class B 128 - 191 10000000

Class C 192 - 223 11000000

Class D 224 - 239 11100000

Class E 240 - 254 Reserved

Notice that the most significant bits are 00 for Class A, 10 for Class B, and 11 for Class C. This will help you determine what Class an IP address is in. (Exam tip: You don't have memorize the chart, just remember the first 2 bits and you can quickly write the chart on your scratch paper when you sit down!) So what class is our example IP address in? Class C!

Do You Have a Reservation?

Before we move on, let's take a look at reserved IP addresses. The way IP was designed, there arose the need to have reserved IP addresses. is a reserved IP address because this address represents ALL IP addresses. Also, is a Broadcast address. If you look in the chart, you will see that we are missing a number. Could you tell what is is? 127. 127 is an IP address used for loopback testing. In fact, if you ping you will get a reply from your own computer! This is used for troubleshooting your NIC. We do not need to know what Class D and E networks are used for on the CCNA exam.

Public vs Private

When the Internet was first conceived, they didn't know how many computers and other devices would eventually be connected together. This caused a major problem: We are running out of IP addresses! If we used every single IP address, we would have about 4.2 Billion addresses all together. Considering how many people and companies have multiple computers and smart phones and IP TV's and smart refridgerators, we need more IP addresses for these devices. One way to solve this is to use private addresses and translate them to public addresses.

OK, time to revisit our postal system example again. Let's say at your house, you have a wife named Anette and a daughter named Areli. You would not only live a life eerily similar to mine, since I do have a wife and daughter with those names, but each of you would get mail from time to time. Unless you had to sleep on the couch and your daughter disowned you, you probably have just one family mailbox. Well, how do you know who gets what mail? You would look at the name on the letter and give the letter to its indended recipient. This way you can all use the same address.

In the same way, companies and home networks can use one public IP address and as many private addresses as needed internally. If you have two computers, you can do this exercise: First, determine what your private addresses are by checking the NIC settings for each. Then, determine what your public IP address is by going to a popular site on the Internet on each computer. You should get different private IP addresses but the same public IP address.

So what are these private addresses? Look at the chart below:

Class A -

Class B -

Class C -

You are free to use any of these networks within your home or work.

Wrap it Up

So to review, IP addresses are 32-bit numbers written in dotted-decimal notation. They are grouped into several classes. By design, there are reserved IP addresses that represent ALL addresses, Broadcasting, and for testing As a way to solve the problem of running out of IP addresses, the concept of private vs public addresses evolved. Anyone can have 1 public IP address, but use any number of private IP addresses to accomplish their objectives.

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